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Best Short-Term Business Loans of 2024

By Randa Kriss
Last updated on March 15, 2024
Edited byChristine Aebischer
Fact checked and reviewed

⏰ Estimated read time: 7 minutes

Short-term loans offer fast funds to cover immediate business expenses. Online lenders typically provide these loans.

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A short-term business loan offers fast cash for working capital, emergency expenses and other immediate financing needs. These small-business loans typically have repayment terms of 12 months or less, although some may have terms that extend up to 24 months.
Below, compare some of the best options for short-term business loans.

How much do you need?

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are 7 short-term business loans

LenderNerdWallet RatingMax loan amountMin. credit scoreNext steps

American Express® Business Line of Credit

5.0/5

Best for Short-term business lines of credit

$250,000660

Bluevine - Line of credit

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5.0/5

Best for Fast short-term business loans

$250,000625

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Fora Financial - Online term loan

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4.5/5

Best for Short-term business loans for bad credit

$1,500,000500

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Fundbox - Line of credit

5.0/5

Best for Short-term business loans for startups

$150,000600

Headway Capital - Line of credit

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5.0/5

Best for Easy short-term business loans

$100,000625

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National Funding - Online Term Loan

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4.0/5

Best for Unsecured short-term business loans

$500,000600

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OnDeck - Online term loan

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5.0/5

Best for Short-term business loans for working capital

$250,000625

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Here are 7 short-term business loans

Best for Short-term business lines of credit

American Express Business Blueprint™

Max Amount

$250,000

Min. Credit Score

660

Best for Fast short-term business loans

Bluevine

Max Amount

$250,000

Min. Credit Score

625

Best for Short-term business loans for bad credit

Fora Financial

Max Amount

$1,500,000

Min. Credit Score

500

Best for Short-term business loans for startups

Fundbox

Max Amount

$150,000

Min. Credit Score

600

Best for Easy short-term business loans

Headway Capital

Max Amount

$100,000

Min. Credit Score

625

Best for Unsecured short-term business loans

National Funding

Max Amount

$500,000

Min. Credit Score

600

Best for Short-term business loans for working capital

OnDeck

Max Amount

$250,000

Min. Credit Score

625

I'M INTERESTED IN:

Our pick for

Short-term business lines of credit

American Express offers short-term lines of credit from $2,000 to $250,000.

American Express® Business Line of Credit

The American Express® Business Line of Credit is a good option for business owners with fair credit who want access to working capital.

Max loan

$250,000

Min. Credit score

660

The American Express® Business Line of Credit is a good option for business owners with fair credit who want access to working capital.

Our pick for

Fast short-term business loans

Bluevine offers short-term financing with terms up to 12 months. Funds can be available within hours of approval.

Bluevine - Line of credit

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Bluevine's line of credit provides fast working capital for short-term borrowing needs.
May fund quickly

Max loan

$250,000

Min. Credit score

625

Apr range

20.00-50.00%

Bluevine's line of credit provides fast working capital for short-term borrowing needs.

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Our pick for

Short-term business loans for bad credit

Fora Financial offers short-term loans for business owners with credit scores of 500 or higher.

Fora Financial - Online term loan

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Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.

Max loan

$1,500,000

Min. Credit score

500

Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.

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Our pick for

Short-term business loans for startups

Fundbox offers short-term funding for startups with six or more months in business.

Fundbox - Line of credit

Fundbox offers a business line of credit to fill a cash flow gap, and qualifying is easier than with other lenders.
May fund quickly

Max loan

$150,000

Min. Credit score

600

Apr range

36.00-99.00%

Fundbox offers a business line of credit to fill a cash flow gap, and qualifying is easier than with other lenders.

Our pick for

Easy short-term business loans

You can get a short-term line of credit from Headway Capital with repayment terms up to 24 months. The lender offers a streamlined application and flexible qualification requirements.

Headway Capital - Line of credit

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Headway Capital offers a fast and flexible line of credit for borrowers who may not qualify for more traditional options.

Max loan

$100,000

Min. Credit score

625

Apr range

35.00-80.00%

Headway Capital offers a fast and flexible line of credit for borrowers who may not qualify for more traditional options.

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Our pick for

Unsecured short-term business loans

National Funding offers short-term loans that don't require physical collateral or a down payment.

National Funding - Online Term Loan

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Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.

Max loan

$500,000

Min. Credit score

600

Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.

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Our pick for

Short-term business loans for working capital

OnDeck’s online term loan offers fast access to working capital with repayment terms up to 24 months.

OnDeck - Online term loan

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OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.
May fund quickly

Max loan

$250,000

Min. Credit score

625

Apr range

35.40-99.90%

OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.

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How Much Do You Need?

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What is a short-term business loan?

Short-term business loans are loans that are meant to address immediate business needs like unexpected expenses or gaps in cash flow, and also opportunities to grow your business that may arise suddenly. They are generally structured as lump sums of capital that you pay back over a set period of time, or term. These loans typically have repayment terms of one year or less — although some lenders may offer terms of up to 18, or even 24, months.

How do short-term business loans work?

Short-term loans are usually repaid on a daily or weekly basis, meaning you’ll make larger, more frequent payments than you would with a long-term business loan.
These loans are most often issued by online lenders, which offer fast funding and streamlined applications. Compared with bank or Small Business Administration lenders, short-term lenders typically have more flexible qualification requirements and may work with startups or businesses with bad credit.
As a result, however, short-term business loans generally have higher interest rates than longer-term loans or more traditional financing options. Interest rates can range from 10% to 99%.

Types of short-term business loans

Here are some of the most common types of short-term business loans:
Loan type
Overview
Use cases
Lump sum of capital you borrow from a lender and repay, over a set period of time, with interest.
Short-term expenses, specific projects or purchases.
Gives you access to a set amount of funds which you can draw from as needed. You only pay interest on the funds that you draw.
Working capital, cash flow gaps, seasonal slows, emergency funding.
Unpaid invoices are sold to a factoring company at a discount in exchange for a cash advance. The company then assumes responsibility for collecting payment from your customers.
Business-to-business companies that have cash tied up in unpaid invoices.
Company gives you an upfront sum of capital that you repay using a percentage of your debit and credit card sales, plus a fee.
Businesses that have substantial debit and credit card sales. MCAs can have extremely high APRs, however, so they should be used as a last resort option.

Pros and cons of short-term business loans

Pros

  • Wide range of uses. Short-term business loans typically don’t have restrictions on the ways you can use them. Because these loans have short repayment terms and fund quickly, however, they’re often best suited for immediate or unexpected expenses.
  • Quick to fund. If you need a fast business loan, some short-term lenders can provide financing in as little as 24 hours. And compared with bank lenders, which may take weeks to process your application, short-term business loans are often funded within a matter of days.
  • Streamlined applications. Most short-term business loans are issued by online lenders, which typically offer streamlined applications. You can usually complete and submit an online application in a matter of minutes, with minimal documentation required.
  • Flexible eligibility criteria. Short-term lenders generally have more lenient qualification requirements compared with more traditional business lenders. Startups or businesses with bad credit may be able to qualify for a short-term business loan.

Cons

  • Can be expensive. Short-term business loans typically have higher interest rates and fees compared with long-term loans. Business bank loans, for example, have annual percentage rates that range from 5.89% to 12.23% whereas short-term loans have rates that range anywhere from 10% to 99%.
  • Frequent repayments. Short-term lenders often require payments daily or weekly as opposed to monthly. This means you’re making larger, more frequent payments over a shorter term. For some businesses, this payment schedule can impede cash flow and can be difficult to manage.
  • Confusing contracts. Not all short-term lenders present interest rates and repayment terms in the same way — which can be confusing when you’re trying to compare products and determine the total cost of your loan. Although some lenders use APR, others might offer a simple interest rate, or even a factor rate. You should always calculate these rates (and fees) into an APR, as this is the best way to understand how much the loan costs.
  • Risk of debt trap. The speed and ease of qualifying for some short-term business loans can be problematic if you can’t keep up with your payments. When these daily or weekly payments cut into your cash flow, you may feel the need to take out another loan or refinance in order to repay. With high interest rates and frequent repayments, this cycle of debt can be difficult to break.

How to get a short-term business loan

You can follow these steps to get a short-term business loan:

1. Assess your financing needs

You’ll want to think about how much funding you need and what you want to use it for. You’ll also want to consider what type of business loan is right for you. In addition to term loans, business lines of credit and invoice factoring are common forms of short-term financing.
Since short-term business loans have more frequent payments and higher interest rates, you’ll want to make sure your business can afford any debt you take on.

2. Evaluate your qualifications

Although short-term lenders often have flexible business loan requirements, you’ll want to know where your company stands before applying. You can check your credit score, time in business and annual revenue — as many lenders use these three criteria to evaluate your loan application.

3. Find and compare lenders

Once you have an understanding of your funding needs and qualifications, you can explore lenders to find the best choice for your business.
As you compare different options, you’ll want to consider factors such as loan offerings, interest rates, fees, repayment terms, application process, funding speed, customer service and lender reputation.

4. Submit your application

Short-term lenders typically offer a streamlined, online application that can be completed fairly quickly with minimal documentation. Although business loan application requirements vary by lender, you may be asked to provide:
  • Business and personal tax returns.
  • Business and personal bank statements.
  • Business financial statements, such as a profit and loss statement.
Short-term lenders don’t usually require physical collateral to secure your loan, but you’ll likely have to sign a personal guarantee. Your lender may also take out a general lien on your business assets.

5. Close your loan

Before you sign a business loan agreement, you should compare all loan offers you receive to make sure you’re getting the best deal for your business. You’ll also want to thoroughly review the agreement and make sure you understand the repayment terms, interest rate and additional fees. If you have any questions, you should ask the lender for clarification before signing.

Find the right business loan

The best business loan is generally the one with the lowest rates and most ideal terms. But other factors — like time to fund and your business’s qualifications — can help determine which option you should choose. NerdWallet recommends comparing small-business loans to find the right fit for your business.
Last updated on March 15, 2024

Methodology

NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including: transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to business credit bureaus and responsible lending practices. We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans and our editorial guidelines.

Wondering if you qualify?

It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.

Learn more

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